A fair data marketplace for all

Submitted by Siddhartha Raja
On Fri, 02/01/2019

co-authors: Tatiana Nadyseva

Credit: Kentoh/Shutterstock[1]
Billions of people around the world are barely aware of their participation in a trillion-dollar data market. Its growth and impact has been accelerated by the easier flow, storage, and analysis of data—thanks to rapid advances in digital technology combined with falling costs of computing. The global data economy is estimated to be worth more than US$3 trillion; the European Commission believes that personalized data was worth over EUR 300 billion by 2016[2]. The application of personal data for online advertising is also skyrocketing with the internet surpassing television as the leading advertising channel. Two internet giants—Facebook and Google—have combined digital advertising revenues on par with the gross domestic product (GDP) of Morocco.

This marketplace is reshaping how people interact with and use information, leading to new opportunities. Yet, it confronts these people and policymakers alike with new questions of the trade-offs between privacy, convenience, and access to information.

In chapter 4 of our latest Information and Communications for Development report[3], we started to frame what this marketplace (or places) might look like. We sought to understand what the costs and benefits were for people—the producers of much the data, the most valued commodity in this new economy. We tried to abstract from the now almost (worryingly regular) news of leaks and hacks to get a better sense of what might be ways to think about public policies that lead to a more balanced and fair data marketplace. We thought about the opportunities and the risks that are emerging, but also about what might be ways to make data marketplaces fairer in their functioning.

Better decisions, greater convenience

The data revolution holds great promise. Data helps people, businesses, and governments make better decisions. People can especially benefit by finding the information they need to improve economic and social lives, enjoy improvements in services, benefit from a variety of free digital services, and access to the innovative products which are tailored to their needs. For example, wearable devices capture detailed health data from people, and in return provide daily health dashboards, measures of wellness, and can even deliver individual programs for fitness or wellness. Better data can also protect against fraud; global financial services company Visa uses consumers’ data to protect them and merchants from fraud as it happens, not hours or days later. Studying and analyzing data from people with cancer allows improvements in treatment and could even predict cancers based on genetic analyses.

Four key risks to consider

Yet, people are not always aware of participation in such data marketplaces, or of their trade-offs, and there is often little they can do to avoid them. In past years, data breach scandals around Yahoo, Facebook, and Experian have shown that companies could fail to keep private data secure. Notably, the number of data records compromised[4] is growing every year. As of November, the U.S. alone saw 1,027 data breaches with millions of peoples’ records stolen.

The loss of privacy is only one of the risks embedded in the data market. Other risks include the loss of agency and loss of control. Loss of agency occurs when people influenced by algorithms lose control over their actions or restrict their ability to determine their own choices. The possibility of Cambridge Analytica using Facebook users’ personal data for targeting voters with personalized political advertisements is an example. And even if the claim is ultimately unproven, the working of algorithms is not clear (as well as what biases might inadvertently or purposefully exist). Loss of control occurs as people give data away unwillingly or unknowingly, and, therefore, lose control over that data, and how it is used or by whom. The collection and use of data in such uncontrolled ways could lead to profiling or exclusion, by organizations that are not accountable; given the increasing bartering of data for online services, the risk of exclusion from such services of those not digitally-connected also increases.

More effort is needed to make these transactions transparent

Data marketplaces have evolved in ways that have led to varying levels of control distributed among a large set of actors. We propose that people should regain control over their own data and should be free to choose how to release it and benefit from it.

The idea seems elegant, but people still give personal data away: knowingly and unknowingly. There are different “standards” and no single ‘breaking point’ that may lead people to organize and shift the distribution of benefits to be fairer.

On the other side are organizations which have become reliant on “free data.” They might not be willing to fundamentally change the rules of the game, especially as paying for data, creating and managing systems for data contribution which would make this “new oil” much less profitable resource for them.

Toward a citizen-controlled market for data

New technologies could help create a future where people can track and monetize their data. Improved digital literacy and awareness will empower people to understand how and when their data is being gathered, and by whom. And a vibrant debate is now underway about the public policies that could help respond to failures in the data marketplace—which lead to unequal distributions of risks, costs, and benefits—with the European Union representing one approach, but others, such as India, Brazil, or the U.S. state of California, also considering rules on how businesses and governments collect, use, and store (and forget) data.

As more people connect to the internet and new ways of collecting, managing, and analyzing personal data become commonplace, more people, including the poor, will participate in the growing data economy. Rethinking policies as technology advances would lead to a fairer data marketplace, positioning individuals—the producers of data—to benefit more from these developments.

This report was supported by the Digital Development Partnership (DDP),[6] a partnership platform for digital innovation and development financing. DDP is currently supported by Denmark, Finland, GSMA, Japan, Korea, Microsoft, and the UK.